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Question: Public Goods 2
This is a variation on the public goods game 1. One difference is that the contribution is $600 instead of $1000. Consequently, all five people need to contribute before the good is supplied. Another difference is that contribu- tions are refunded if fewer than five people contribute. Now there are just two outcomes.
(i) If all five people choose C, then the good is provided, and everyone pays the $600 contribution.
(ii) If fewer than five people choose C, then the good is not provided and no one actually pays the contribution. Everyone prefers the first outcome to the second. Let N be the number of people other than the representative player who choose to contribute (C).
(a) Construct a payoff function for a representative player.
(b) Find all the Nash equilibria of this game.
(c) Find all the Pareto-optima.
(d) Is there a dominant strategy?
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